Why Is Branding So Important? Key Takeaways From BZ Cannabis Hour
This week's Benzinga Cannabis Hour featured the leaders of Dixie Brands and BR Brands — two companies that agreed to a $43-million reverse takeover deal just as the COVID-19 pandemic was beginning to devastate the US.
"We were admiring them as a brand [house]," BR Brands chair Andrew Schweibold said at the top of the show. "Ultimately the opportuity arose for us to combine our platforms, to maximize synergies and value for all shareholders."
Benzinga's Patrick Lane asked why brands are so important in the cannabis space.
"When it comes to storytelling and moving the market forward — what does it mean to create a brand in this market?"
Dixie Brands President and CEO Chuck Smith said it's important to remember that the industry is in its nascent stages.
"Over the last couple of years, we've certainly seen the demographic of the consumer expand exponentially."
The market share for infused products is starting to climb, while flower products decline, Smith said. With a whole new set of consumers, companies like Dixie and BR have to figure out what they want.
These new consumers are coming into the market with "a broad specturm of preferences," said Smith, adding that some prefer mom-and-pop businesses.
"They're also looking for consistency, trust, quality, confidence."
Revenue has jumped during the pandemic, and customers are sticking with the tried-and-true, he said.
"So we believe that brands play an incredibly important role going forward in this ever-evolving cannabis industry."
Also Featured On The Benzinga Cannabis Hour:
- Ayr Strategies Inc. (OTCQX:AYRSF) COO Jen Drake talked up her firm's unique approach to doing a rollup of cannabis companies that were already making money. "Our view is positive cash flow is what keeps you at the table long term."
- Pleasantrees CEO Randy Buchman discussed the "wild ride" to opening a cultivation facility and beginning his company's first harvest in May.
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